(First appeared in The Pioneer dated November 30, 2011)
On November 24, the Union Cabinet cleared a proposal to allow up to 51 per cent foreign direct investment in the multi-brand retail sector. The decision is not suspect, because it will eventually be a game-changer for the consumers, traders and farmers, who will all benefit. What is suspect is the timing. Why on earth did the UPA Government, fully aware that it does not enjoy the support of not just the Opposition but also some of its own allies on the issue, take the decision in the midst of the Winter Session of Parliament? It cannot have been unaware that the Cabinet decision would raise the hackles of several parties in the two Houses and add to the list of controversial subjects that have already stalled the functioning of the current session since it began on November 22.
The Cabinet could have cleared the FDI proposal soon after the Winter Session, which in any case is a mere 21-day affair. The skies would not have fallen because of a delay of three weeks, and the Members of Parliament would have had an issue less to create a ruckus. There can be two reasons for the move: One, faced with the allegation of policy paralysis and loss of confidence of the corporate sector, the Government was desperate to counter the charge and simultaneously expose the Opposition for its conduct over progressive legislations that the UPA was ‘committed’ to. Two, the decision was a well-calculated step by the Government, designed to further plunge Parliament into chaos so that the crucial Lokpal Bill – among the most contentious legislations – is not taken up for consideration. The first aim does not enjoy credibility because the FDI decision alone is not going to reverse the UPA’s negative image. Moreover, by antagonizing the majority of parliamentarians and making it even more difficult for the decision to be implemented, the Government has done no favour to industry. On the contrary, the UPA stands more tainted than vindicated by its ill-timing.
The second theory is more alluring. We have been often told that investigators involved in resolving murder mysteries never lose sight of the motive behind the crime, because the motive pins the criminal down like nothing else does. If we apply this analogy here, it is obvious that the Congress gains to benefit the most by the disruptions in the two Houses, since it can avoid the presentation of Bills that are bound to raise a storm and expose the UPA for its duplicity. This provides a credible enough motive for the Government to prefer a situation of the kind that we see in Parliament.
But why should the UPA, which is supposedly committed to a strong Lokpal institution, want to prevent the Bill from seeing the light of the day for as long as it can manage? After all, this is one piece of legislation that can undo much of the damage that the Government’s image has suffered over the last few months in the wake of a series of scams. The answer is: While the Congress has been assuring every one that the Government will bring before Parliament a strong anti-corruption Bill, it has already chickened out and done its bit to weaken the proposed legislation. Congress members in the Parliamentary Standing Committee that is examining the issue have been vociferous in opposing the inclusion of the Prime Minister under the Lokpal’s ambit. Naturally, if the Bill comes before the two Houses, the Government will be hard-pressed to explain how the Bill can be “strong and effective” – as it had promised – by excluding the high office of Prime Minister from the Lokpal’s jurisdiction. Because the Congress has no satisfactory answers, it would want to avoid the embarrassment by preventing the Bill from coming before Parliament, at least for now. This, of course, does not mean that the party will succeed. Despite everything, the Lokpal Bill may still be placed in Parliament – and trashed.
That the Congress should announce the FDI policy in multi-brand retail even without getting its own allies on board furthers the suspicion that the party’s strategy was not to push through the FDI as much as it was to somehow ensure that Parliament did not take up the Lokpal and some other Bills. What else can explain the fact that, while key UPA ally and Chief Minister of West Bengal Mamata Banerjee has been opposed to the FDI, the Cabinet went ahead and endorsed the decision, instead of having waited for a while more and convinced her of the benefits of FDI? Now, she has bluntly refused to allow multi-brand retails with foreign direct investment in her State. The all-party meet that the Prime Minister convened to discuss the controversial matter – which incidentally yielded no result – should have happened earlier.
Having thrown up the FDI controversy in an apparent bid to prompt the disruption of Parliament, the UPA can now turn around and say that all its defining legislations are becoming victims of Opposition-staged chaos in the two Houses. This way the Government can also seek to ‘expose’ the ‘non-progressive agenda’ of the opposition parties. In fact, this is precisely what the Congress has begun doing. At an event recently organised by a leading economic daily, various Union Ministers slammed the Opposition for disrupting Parliament and not allowing key legislations to be considered. Such was their anger that one of the Ministers even took swipes at Indian business for praising BJP leader and Gujarat Chief Minister Narendra Modi. The context was different but the intent was crystal clear: Discredit the Opposition for the UPA’s dwindling image.
The Ministers at the event also lectured business leaders to stop cribbing and start finding solutions to problems. In doing so, the Ministers in a way placed them at par with the opposition leaders who they allege are forever plotting damage. Corporate India is, like all of us, witness to the games the Congress-led UPA has been playing to deflect attention from its failings. So, will such measures work?
It is true that the BJP has made a laughing stock of itself by opposing FDI in multi-brand retail after having over the years positioned itself as a reform-minded party. But it is equally true that the Congress did not bother to reach out to the main opposition party before announcing its decision on FDI, giving the BJP an opportunity to hit back. Since the Left’s position has been as intractable as ever on the issue, the BJP was the one hope of the Congress. But the ruling party did not think it important enough to get the BJP on board, just as it did not solicit the Opposition’s support in handling Anna Hazare’s anti-corruption movement, depending instead on a bunch of Ministers who were too puffed up with a sense of their own importance to project the humility needed in tackling such emotive issues.
The fall-out of the Congress-led UPA Government’s strategy has been the creation of a ‘mood’ against foreign direct investment in the retail sector, with several key leaders ranging from the BJP to the Left to regional parties, voicing their opposition. The Congress has managed to vitiate the atmosphere by hardening the stand of the Opposition and some of its allies over the issue. This is most unfortunate, because FDI in retail deserves a fair chance.